Frontdoor Q2 revenue rises 5%, slightly beats estimates

Overview

• U.S. home warranty provider's Q2 revenue rose 5%, slightly beating analyst expectations

• Adjusted EPS for Q2 rose 19% to $1.93, beating analyst expectations

• Company raised full-year 2026 outlook and completed $181 mln in share repurchases YTD

Outlook

• Frontdoor raises full-year 2026 revenue outlook to $2.19 bln-$2.21 bln

• Company now sees 2026 adjusted EBITDA of $585 mln-$600 mln

• Frontdoor expects Q3 2026 revenue of $642 mln-$652 mln

Result Drivers

• HIGHER REALIZED PRICE - Co said Q2 revenue growth was mainly driven by price increases through its dynamic pricing model

• LOWER CONTRACT CLAIMS COSTS - Co said profitability benefited from fewer service requests per member, including $5 mln from favorable weather

• OTHER REVENUE GROWTH - Co said 'Other' revenue grew 19%, mainly due to the new HVAC upgrade program

Company press release: ID:nBwbptY8ga

Key Details

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 2 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the personal services peer group is "buy"

• Wall Street's median 12-month price target for Frontdoor Inc is $71.00, about 7% below its August 5 closing price of $76.38

• The stock recently traded at 16 times the next 12-month earnings vs. a P/E of 15 three months ago

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For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)